Senate moves forward with EITC increase

Though Democrats have shown little interest in Gov. Christie’s phased-in minimum wage increase, at least one part of the governor’s conditional veto proposal is moving forward.

Though Democrats have shown little interest in Gov. Christie’s phased-in minimum wage increase, at least one part of the governor’s conditional veto proposal is moving forward.

The Senate Thursday approved a Democrat-sponsored bill to restore the state’s earned income tax credit to 25 percent of the federal credit amount. Christie trimmed the EITC to 20 percent in the Fiscal Year 2011 budget, but he proposed restoring it to 25 percent when he conditionally vetoed the Assembly’s minimum wage bill last month.

In a statement, Sen. Jim Whelan (D-Northfield), one of the bill’s sponsors, said increasing the EITC makes good economic sense.

“By restoring the EITC to its full level in New Jersey, we can help working families to reduce their tax liability and provide them with extra income,” said Whelan. “In turn, they will spend that income, putting money back into our economy and strengthening our economic income.”

Of course, Christie’s EITC proposal was just one part of a package. He also wanted the Legislature to agree to phase the minimum wage increase in over three years and drop the idea of linking it to the Consumer Price Index. Business groups largely approved of Christie’s compromise proposal, but it’s been a non-starter with Assembly Speaker Sheila Y. Oliver (D-East Orange) and Senate President Stephen M. Sweeney (D-West Deptford). Sweeney is now moving forward with his plan to put the minimum wage increase, with a CPI link, on November’s ballot. A poll from October suggested the measure is popular with voters.

The EITC restoration passed the Senate with broad bipartisan support Thursday, 27-1. The vote to put minimum wage on the ballot, however, passed 22-15.